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17. You have $1,500 that you would like to invest for one year. You have 2 choices: savings account A which earns 8.3% compound annually
17. You have $1,500 that you would like to invest for one year. You have 2 choices: savings account A which earns 8.3% compound annually or savings account B which earns 8% compounded semi-annually. Which would you choose? A. Savings Account A Savings Account B You are indifferent between Savings Account A and Savings Account B B. C. 18. Assume that a bank pays you 4% interest per (every) quarter on a savings account. (The periodic rate is 4%, and the 4% is paid every 3 months.) Assume that you save $200,000 in that account today. How much will you have in that account exactly one year from today? 19) You will buy a new car today. You will borrow the full price of the car. You will get a seven year loan that will be paid back annually. It will take you the full seven years to pay back the loan. (In other words, you will not pay it off early.) You will pay back the same amount every year (an annuity). The auto dealership offers you 3 choices
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